Music industry giants, including Post Malone, Chris Brown, LeAnn Rimes, and Nickelback, reportedly received substantial sums of money from a taxpayer-funded program aimed at supporting struggling venues and musicians during the Covid-19 pandemic. The program, called the Shuttered Venue Operators Grant, was administered by the Small Business Administration (SBA) and was intended to provide a lifeline to live entertainment businesses that were severely impacted by lockdown measures.
The program distributed a total of $14.5 billion to various institutions, such as movie theaters, performing arts venues, talent agents, and artists. Unlike the Paycheck Protection Program, which offered loans, qualified applicants for the Shuttered Venue Operators Grant were eligible for grants of up to $10 million, which did not need to be repaid, to compensate for lost revenue.
According to an investigation by Insider, limited liability companies associated with popular artists took advantage of this program. It was found that one Los Angeles asset-management firm, NKSFB, successfully secured grants on behalf of 97 artists, venues, and managers, including Post Malone, Korn, and Steve Aoki, amounting to a combined payout of $260 million.
Post Malone, with an estimated net worth of at least $45 million, and Chris Brown, with an estimated net worth of around $50 million, were among the artists who allegedly received the maximum $10 million payout. Additionally, rapper Lil Wayne received $8.9 million, while LeAnn Rimes and Nickelback received $2 million each.
Although it remains unclear how these funds were utilized, there is no evidence to suggest that the payments to these high-profile artists violated any laws. The grants could have been used to cover expenses such as payments for lighting and sound technicians, costumers, drivers, security personnel, and other contractors who were left without work due to canceled tours or concerts.
However, there was no requirement for corporations and limited liability companies to use the funds specifically to support these workers. Recipients were legally permitted to allocate the money towards existing mortgage payments, taxes, payroll, and even personal compensation.
In the midst of ongoing investigations into fraudulent claims related to pandemic-era aid, the SBA, which oversaw the Shuttered Venue Program, highlighted that nearly half of the grant money went to businesses with fewer than five full-time employees, reflecting its commitment to support the smallest of small businesses.
Earlier this year, an SBA report revealed that potential mismanagement of COVID-19 relief programs amounted to $200 billion, approximately 17 percent of the total $1.2 trillion disbursed by the agency. However, the SBA has downplayed the likelihood of widespread fraud within the Shuttered Venue Program, estimating that less than 1 percent of the grants disbursed were fraudulent.
In a statement to Insider, an SBA spokesperson emphasized that the Shuttered Venue Program played a crucial role in preserving thousands of entertainment venues and operators throughout the country during the challenging times of the Covid-19 pandemic.
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